Imperial Innovations Group Regulatory News (IVO)

12 September 2017

Touchstone Innovations plc

Touchstone commits £8m in £18m funding round in Ieso Digital Health

Touchstone Innovations plc (AIM: IVO, 'the Group', 'Touchstone') has co-led a £18.0 million funding round in Ieso Digital Health ("Ieso" or "the Company"), the UK's leading provider of online Cognitive Behavioural Therapy (CBT) for the treatment of people suffering from community based mental healthcare conditions, predominantly depression and anxiety.

Touchstone has committed £8.0 million to the round, including a loan of £2.0 million from May 2017, which has now converted to equity. Touchstone invested alongside new investor Draper Esprit, who co-led the round, together with existing investor Ananda Social Venture Fund and a number of business angels.

Ieso, based in Cambridge, is the largest provider of online CBT in the UK. By the end of 2017, Ieso will have delivered over 100,000 hours of therapy to more than 16,700 patients, within the 9 million patients who have access via clinical commissioning contracts. The Company's proprietary web-based platform provides patients with access to CBT, delivered in real-time by accredited therapists utilising written (typed) conversation directly accessible from their computer, tablet or smartphone.

Therapy delivered in this way has been clinically validated in routine NHS service to deliver better results than traditional face-to-face methods, with higher levels of access, patient engagement, therapy session completion and lower drop-out rates. 

The new funding will enable Ieso to continue to grow its UK business and accelerate its introduction and expansion in the US, where the Company has achieved significant early traction and recently appointed a new highly-experienced management team.

As at 31 January 2017, the Group had a 46.9% interest in the issued share capital of Ieso. Following this new investment Touchstone will hold a 49.3% interest in the Company.

Commenting on this funding round, Dan Clark, CEO of Ieso said:

"Ieso is creating transformative change in mental health treatment.

"An estimated 60% of patients do not seek out mental health services, largely because of stigma and difficulty in accessing care. We've helped eliminate these barriers and are empowering patients by delivering therapy at a time that fits their lifestyles and through devices that are a part of their everyday lives.

"This new funding will allow us to continue scaling geographically and innovating our technology by applying artificial intelligence and machine learning to enhance therapist support and further improving patient access."

Inga Deakin, Principal at Touchstone and Ieso Board member added:

"We first invested in Ieso in 2013. From the outset, we believed that the best way to nurture the business was to demonstrate traction in the UK National Health Service, which has a world-leading CBT delivery infrastructure and ambitious targets for delivery of treatment to patients.

"With more than 16,700 patients treated, Ieso has developed outstanding clinical credentials and built a strong evidenced-based platform. The Company has also assembled a highly-experienced management team, comprising world-class artificial intelligence and data scientists, clinicians, therapists and executive leadership.

"This new funding round is the largest amount raised by a digital behavioural health business in Europe and will enable the next phase of growth."

For further information contact:

About Touchstone Innovations - www.touchstoneinnovations.com

Touchstone Innovations plc (formerly Imperial Innovations Group plc) creates, builds and invests in pioneering technology companies and licensing opportunities developed from outstanding scientific research from the 'Golden Triangle', the geographical region broadly bounded by London, Cambridge and Oxford.

This area has an unrivalled cluster of outstanding academic research and technology businesses, and is home to four of the world's top 10 universities, as well as leading research institutions, the cream of the UK's science and technology businesses and many of its leading investors.

Touchstone supports scientists and entrepreneurs in the commercialisation of their ideas through protecting and licensing out intellectual property (through its Technology Transfer subsidiary, Imperial Innovations Limited), by leading the formation of new companies, by recruiting high calibre management teams and by providing investment and encouraging co-investment. Touchstone remains an active investor over the life of its portfolio companies, with the majority of its investment going into businesses in which it is already a shareholder.

Since becoming a public company in 2006, Touchstone has raised more than £440 million of equity from investors, which has enabled it to invest in some of the most exciting spin-outs to come out of UK academic research. In addition, the Group has drawn down the outstanding £50.0 million from the European Investment Bank (EIB) taking the total loan to £80.0 million.

Between admission to AIM (August 2006) and 30 June 2017, Touchstone has invested a total of £364.0 million across its portfolio companies, which have collectively raised investment of more than £1.5 billion.

About Ieso Digital Health - https://uk.iesohealth.com/

Ieso Digital Health (Ieso) offers real-time one-to-one therapy online for people dealing with depression and anxiety. The Company's proprietary web-based platform enables Cognitive Behavioural Therapy (CBT) to be delivered in real-time by real therapists using written (typed) conversation.

Ieso is the largest provider of online CBT in the UK, and has treated more than 16,700 patients and captured over 75 million clinical data units in the company's therapy database. These data are then analysed, with the findings being used to support continuous improvement in the product and in the therapists' performance.